The Libyans accuse one of the world’s major banks of
exploiting the naivety of the LIA by making risky bets on its behalf, most of which
lost vast amounts of money. There are some
colourful allegations about the lengths Goldman appears willing to
have gone to win the business, which the bank denies. For Global Witness, our
main interest is in how big banks appear willing to turn a blind eye to a glaringly
obvious corruption risk. This approach makes it is easier for powerful elites to steal
from their people, which triggers the kind of unrest and suffering that has
plagued this region for many years.

We’ll be monitoring the case over the next few weeks and
offering comment on the role of the bank in claimed mismanagement of Libyan
state funds.

“This case is an important reminder of how keen a number of
major financial institutions were to do business with such a corrupt
government,” said Robert Palmer, anti-money laundering campaign leader at
Global Witness. “Access to the international financial markets allows regimes
like Gaddafi’s to continue to enrich themselves at the expense of their people.
That kind of corruption was the backdrop for uprisings in the Middle East which
are still playing out today. It’s time for banks to turn down this sort of
business”.